Correlation Between GIMV NV and Cenergy Holdings
Can any of the company-specific risk be diversified away by investing in both GIMV NV and Cenergy Holdings at the same time? Although using a correlation coefficient on its own may not help to predict future stock returns, this module helps to understand the diversifiable risk of combining GIMV NV and Cenergy Holdings into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between GIMV NV and Cenergy Holdings SA, you can compare the effects of market volatilities on GIMV NV and Cenergy Holdings and check how they will diversify away market risk if combined in the same portfolio for a given time horizon. You can also utilize pair trading strategies of matching a long position in GIMV NV with a short position of Cenergy Holdings. Check out your portfolio center. Please also check ongoing floating volatility patterns of GIMV NV and Cenergy Holdings.
Diversification Opportunities for GIMV NV and Cenergy Holdings
0.68 | Correlation Coefficient |
Poor diversification
The 3 months correlation between GIMV and Cenergy is 0.68. Overlapping area represents the amount of risk that can be diversified away by holding GIMV NV and Cenergy Holdings SA in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Cenergy Holdings and GIMV NV is a relative statistical measure of the degree to which these equity instruments tend to move together. The correlation coefficient measures the extent to which returns on GIMV NV are associated (or correlated) with Cenergy Holdings. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Cenergy Holdings has no effect on the direction of GIMV NV i.e., GIMV NV and Cenergy Holdings go up and down completely randomly.
Pair Corralation between GIMV NV and Cenergy Holdings
Assuming the 90 days trading horizon GIMV NV is expected to generate 18.32 times less return on investment than Cenergy Holdings. But when comparing it to its historical volatility, GIMV NV is 2.5 times less risky than Cenergy Holdings. It trades about 0.01 of its potential returns per unit of risk. Cenergy Holdings SA is currently generating about 0.09 of returns per unit of risk over similar time horizon. If you would invest 310.00 in Cenergy Holdings SA on August 26, 2024 and sell it today you would earn a total of 534.00 from holding Cenergy Holdings SA or generate 172.26% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 100.0% |
| Values | Daily Returns |
GIMV NV vs. Cenergy Holdings SA
Performance |
| Timeline |
| GIMV NV |
| Cenergy Holdings |
GIMV NV and Cenergy Holdings Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with GIMV NV and Cenergy Holdings
The main advantage of trading using opposite GIMV NV and Cenergy Holdings positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if GIMV NV position performs unexpectedly, Cenergy Holdings can make up some of the losses. Pair trading also minimizes risk from directional movements in the market. For example, if an entire industry or sector drops because of unexpected headlines, the short position in Cenergy Holdings will offset losses from the drop in Cenergy Holdings' long position.| GIMV NV vs. Groep Brussel Lambert | GIMV NV vs. Ackermans Van Haaren | GIMV NV vs. Sofina Socit Anonyme | GIMV NV vs. Brederode SA |
| Cenergy Holdings vs. Ackermans Van Haaren | Cenergy Holdings vs. NV Bekaert SA | Cenergy Holdings vs. Groep Brussel Lambert | Cenergy Holdings vs. Tubize Fin |
Check out your portfolio center.Note that this page's information should be used as a complementary analysis to find the right mix of equity instruments to add to your existing portfolios or create a brand new portfolio. You can also try the Stocks Directory module to find actively traded stocks across global markets.
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